3 Tips to Thwart Child Identity Theft
Child’s Identity Theft In the News
Child identity theft is a real problem. Scammers have found clever ways to commit steal children’s identities and make a living off of kids.
A 2021 study by Javelin Strategy found that one in 50 children were victims of identity theft in the past year. We increasingly see school districts as targets of cybercrime because of the wealth of information they have access to and the limited resources they have to create a protection program.
As parents, your staff is always looking out for their children’s safety. Below, we’ll cover the ways to protect a child’s identity, how to recognize the warning signs of child identity theft, and what to do if a child’s identity is stolen. Share these tips with employees to help them protect their most treasured assets; their kids.
What is Child Identity Theft?
Child identity theft happens when someone fraudulently uses the identity of a minor.
It’s illegal for anyone under age 16 to apply for a loan, but very few companies verify ages with government documentation.
That means identity thieves could technically use a newborn baby’s personal data to apply for credit cards and government benefits or commit loan fraud.
Children are highly desirable targets for identity theft because children don’t have credit scores, credit card statements, or any credit history at all. Children are digital ghosts, making them the perfect target for identity theft.
Child victims often don’t learn about their stolen identities until much later in their adult life. For example, their student loan application may get rejected, or they could fail a background check for a new job.
THINGS YOU CAN DO
Encourage Parents to Freeze their Child’s Credit
Since children can’t get credit until they’re at least 16 years old, initiating a security freeze is the best way to prevent identity theft.
A credit freeze blocks access to a child’s credit report and denies all credit applications. The parent or the child can reverse the freeze when they’re old enough to need credit.
Setting up a security freeze for a child is more complicated than setting one up for an adult, but it’s worth the time.
Parents will need to contact the three major credit bureaus — Equifax, Experian, and TransUnion — and prove the identities, and show that they’re the parent or legal guardian.
The process is slightly different for each credit bureau, but parents will to show their ID as well as the child’s birth certificate.
The process is a bit simpler for older children since 16- or 17-year-olds can initiate a security freeze by themselves.
Teach Parents to Limit Information Sharing
Sadly, in three out of five cases of child identity fraud, the child victim knows the perpetrator.
Anyone — from family friends to volunteers in school activities — can take advantage of the information that children share with them.
That’s why it’s a good idea to keep the most vulnerable piece of personal information — your child’s Social Security number — as private as possible.
The IRS is the only entity that truly needs to know your child’s Social Security number. When forms from school or doctor’s offices request your child’s SSN, you can usually leave it blank. If you absolutely must share, ask how the number will be secured and who will have access to it.
Alternatively, you can offer the last four digits (instead of the full number), although these digits are still valuable to cybercriminals.
Think Old School
When you think of identity theft computer hacking is top of mind; but old-school crime like burglary and mail theft are just as dangerous.
Encourage parents to designate safe-keeping place for important docs (social security card, passports, birth certificates. medical records, etc). A heavy safe stored out of sight is a solid option. Lightweight and small safes, while convenient, can be carried away to be cracked open later.
Shred documents with any personal information on them, after they’re no longer needed.
Warning Signs of Child Identity Theft
- Your child already has a credit report: You can request a free copy of your child’s credit report at AnnualCreditReport.com. If there’s already a report under your child’s name, this is an obvious red flag. Credit reporting agencies don’t generate reports for minors, so identity theft may be at play.
- Your child receives credit offers: If you see pre-approved credit card offers or other financial “junk mail” addressed to your children, this usually means their identities have been used to apply for credit.
- Your child receives collection notices or bills: Debt collection letters or bills addressed to your child may signify that a credit lender is trying to recover unpaid debts that someone has accrued in your child’s name. This is a classic red flag for ID theft.
- Your child receives IRS letters claiming unpaid taxes: If IRS letters addressed to your child appear your mailbox, it’s a clear indicator that someone has used your child’s Social Security number at a job. You should only trust a physical letter, as nearly all calls claiming to be from the IRS are scams. (The IRS will only call about large amounts of overdue taxes, and will always send a notice first.)
- Your child is denied government benefits: If your child is denied benefits because their Social Security number has already been used, it could mean someone else has applied for benefits, such as unemployment, with your child’s personally identifying information.
What to Do If You Suspect Your Child’s Identity Has Been Stolen
If you suspect your child is a victim of identity theft, take the following steps:
- Review and freeze your child’s credit report. Review your child’s credit file (if it exists) to understand the extent of the damage. Setting up a security freeze is the best protective measure to prevent future fraud.
- Notify credit bureaus and impacted companies. If your child has an active credit report, ask all three credit bureaus to investigate the possibility of fraud. Alert any listed companies and let them know the activity was fraudulent, and ask them to investigate.
- File a report with the FTC (Federal Trade Commission). Report the stolen identity to the FTC at IdentityTheft.gov. You’ll need this report for the next step.
- Alert local law enforcement. Take all supporting documentation, including your FTC report, and file a police report for identity theft.